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PIGTAILS AND CREWCUTS - FDD UFOC ITEM 7 Detail

ITEM 7351

^"ESTIMATED353INITIAL
INVESTMENT354 Below are estimates of your total initial investment.�Your
actual investment and expenditures may vary from the
estimates below��� depending on many factors
including where your Salon is situated, the size of your Salon, your ability to
negotiate to your benefit with your landlord, your management
capabilities, and the amount contributed by your landlord356t357

Note 1: The initial franchise
fee includes the loan of our Operations Manual and initial training for you and
your Operating Manager (if someone other than you). See Item 11 of this Offering
Circular379for additional information about the initial
training program. A portion of the initial franchise fee is refundable
under certain conditions (See Item 5 of this Offering Ctfetto380).
We
offer a discount structure if vou agree to
develop and operate at leasjJLoj; 5 Salons
(See Item S\. This chart assumes vou have
not entered into an Development Addendum3*''

Note 2: These figures presume
that you will be leasing the Pigtails & Crewcuts Salon premises. Leasing
expenses will vary depending upon the size of the premises, its location, and
the requirements of individual landlords. Landlords typically require payment
in advance of the first and/or last (or more) month''s rent. The total estimated
initial investment shown in the chart above includes the amount of these
estimated annual rental382nre-onening383costs (including the "triple net" costs).
Some franchisees prefer to own the Pigtails & Crewcuts Salon premises in
which they will operate. The costs of purchasing vary so widely as to preclude
reasonable estimation by us. Regardless of whether you lease or purchase the
Pigtails & Crewcuts Salon premises, a typical Pigtails & Crewcuts Salon
occupies approximately 1,200 to 1,800 square feet of space. The Pigtails &
Crewcuts Salon may be either a freestanding building or an in-line retail plaza
space, but, in any event, the Salon must have ample parking, good visibility
and availability of prominent signage. The cost of leasehold improvements will
vary widely depending upon the size and condition of the premises, whether or
not there are any existing and comparable leasehold improvements in the
premises, the extent and quality of improvements desired by you over and above
our minimum requirements, landlord''s cash contribution to the cost of the
improvements, and the like. The amount shown is based upon our past experience.
These figures may vary considerably throughout different parts of the United States.

Note 3: We provide initial
training at no charge, but you must arrange and pay for all food and lodging
expenses for the people who attend the initial training program. Costs vary
depending on the distance traveled and the type of lodging.

Note 4: You must conduct a
grand opening advertising campaign with the opening of your Salon. You must pay
all costs of the grand opening, including publicity costs, promotional costs,
plus the full cost of any price reductions or other customer inducements. We
will assist you with developing and carrying out the grand opening campaign.
Costs may vary depending on your market and the type of advertising used.

Note 6: This estimates your
expenses during the first three months of operation. These expenses include
payroll costs (excluding any wage or salary paid to you), other miscellaneous
expenses and working capital. These figures are estimates based on our past
business experience. We cannot guarantee that you will not have additional
expenses starting the business. Your costs will depend on factors like how
closely you follow our methods and procedures; your management skill,
experience and business knowledge; local economic conditions; the local market
for our product; the prevailing wage rate; competition; and the sales level
achieved during the initial period.

Note 7: We relied on our own
experience, our predecessor''s experience in operating the original Pigtails
& Crewcuts Salon, and our management''s business acumen to compile these
estimates. These figurcs384Your actual investment and
expenditures385 may vary considerably throughout different parts
of the United StatesT3ii6 depending on many factors
including where vour Salon is situated, the size of vour Salon, vour
ability to negotiate to vour benefit with vour landlord, vour management
capabilities, and the amount contributed bv vour landlord387.
You should review these figures carefully with a business advisor before making
any decision to purchase the franchise.

Note 8: We do not offer
direct or indirect financing to franchisees for any of these items.
The availability and terms of financing will depend on factors like the
availability of financing
generally, your credit worthiness, collateral you pledge, policies of your
lending institution, and
economic conditions in your area. The estimate does not include anv finance
charges,
interest, or debt service obligations. Except for a portion of the
initial franchise fee, no
amounts�� in�� the�� chart�� are�� refundable.����������������������������������������� See��
also�� Item�� 10�� of this Offering